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Note L - Stock Options

12 Months Ended

Sep. 28, 2019

Share-based Payment Arrangement [Text Block]

NOTE L – STOCK OPTIONS

We have a Stock Option Plan (the “Plan”). Pursuant to the Plan, stock options may be granted to officers and our key employees which qualify as incentive stock options as well as stock options which are nonqualified. The exercise price of incentive stock options is at least the fair market value of the common stock on the date of grant. The exercise price for nonqualified options is determined by a committee of the Board of Directors. The options are generally exercisable after three years and expire no later than ten years from date of grant. There are 454,000 shares reserved under the Plan for which options have not yet been issued. There are options that were issued under prior option plans that have since been replaced that are still outstanding.

We have an Employee Stock Purchase Plan (“ESPP”) whereby employees purchase stock by making contributions through payroll deductions for six month periods. The purchase price of the stock is 85% of the lower of the market price of the stock at the beginning of the six-month period or the end of the six-month period. In fiscal years 2019, 2018 and 2017 employees purchased 12,492, 12,763 and 13,271 shares at average purchase prices of $121.37, $119.39 and $105.85, respectively. ESPP expense of $390,000, $423,000 and $363,000 was recognized for fiscal years 2019, 2018 and 2017, respectively.

A summary of the status of our stock option plans as of fiscal years 2019, 2018 and 2017 and the changes during the years ended on those dates is represented below:

	Incentive Stock Options					Nonqualified Stock Options
				Weighted-					Weighted-
	*Stock*			*Average*		*Stock*			*Average*
	*Options*			*Exercise*		*Options*			*Exercise*
	*Outstanding*			*Price*		*Outstanding*			*Price*


Balance, September 24, 2016		355,787		$	92.81		311,884		$	75.56
Granted		121,508			129.35		59,786			129.94
Exercised		(78,114	)		65.49		(60,156	)		41.46
Canceled		(6,200	)		100.93		-			-

Balance, September 30, 2017		392,981			109.41		311,514			92.58
Granted		122,595			141.07		58,083			144.41
Exercised		(64,470	)		90.75		(37,328	)		56.85
Canceled		(17,550	)		115.21		-			-

Balance, September 29, 2018		433,556			120.90		332,269			105.66
Granted		118,934			163.14		66,236			171.78
Exercised		(100,018	)		102.01		(35,763	)		101.03
Canceled		(18,320	)		127.88		-			-

Balance, September 28, 2019		434,152		$	136.53		362,742		$	118.19

Exercisable Options
September 28, 2019		94,492		$	106.36		179,428		$	86.10

The weighted-average fair value of incentive stock options granted during fiscal years ended September 28, 2019, September 29, 2018 and September 30, 2017 was $26.29, $23.68 an $18.84, respectively. The weighted-average fair value of non-qualified stock options granted during the fiscal years ended September 28, 2019, September 29, 2018 and September 30, 2017 was $33.11, $31.44 and $24.82, respectively. The total intrinsic value of stock options exercised was $9.4 million, $6.8 million and $10.1 million in fiscal years 2019, 2018 and 2017, respectively.

The total cash received from these option exercises was $12.7 million, $7.4 million and $5.8 million in fiscal years 2019, 2018 and 2017, respectively; and the actual tax benefit realized from the tax deductions from these option exercises was $1.8 million, $1.7 million and $3.0 million in fiscal years 2019, 2018 and 2017, respectively.

The following table summarizes information about incentive stock options outstanding as of September 28, 2019:

Options Outstanding

Options Exercisable

Number

Weighted-

Number

Outstanding

Average

Weighted-

Exercisable

Weighted-

at

Remaining

Average

at

Average

Range of

September 28,

Contractual

Exercise

September 28,

Exercise

Exercise Prices

2019

Life

Price

2019

Price

$100.76 -
$143.69
317,018 2.4 $ 126.67 94,492 $ 106.36

$153.42 -
$163.29
117,134 4.6 163.20 - -

Total options
434,152 3.0 136.53 94,492 106.36

The following table summarizes information about nonqualified stock options outstanding as of September 28, 2019:

Options Outstanding

Options Exercisable

Number

Weighted-

Number

Outstanding

Average

Weighted-

Exercisable

Weighted-

at

Remaining

Average

at

Average

Range of

September 28,

Contractual

Exercise

September 28,

Exercise

Exercise Prices

2019

Life

Price

2019

Price

$41.75 -
$57.33
60,000 2.0 $ 48.89 60,000 $ 48.89

$80.79 -
$119.44
119,428 4.1 104.79 119,428 104.79

$129.26 -
$191.40
183,314 5.3 149.60 - -

Total options
362,742 4.4 118.19 179,428 86.10